Sequans Communications S.A. (NYSE:SQNS) reported a sharp increase in third-quarter 2026 revenue, supported by stronger product sales and improved gross margins, while significantly reducing its operating and net losses. The semiconductor company also completed its exit from its Bitcoin treasury strategy and eliminated its outstanding convertible debt.
According to preliminary unaudited results, revenue for the quarter ended September 30, 2026, reached $9.1 million, representing an increase of 182.8% from the corresponding period last year and 21.9% compared with the second quarter.
The company also reported a substantial improvement in its cash position, with cash, cash equivalents and short-term deposits increasing to $39.7 million at the end of September.
Sequans’ third-quarter revenue performance was primarily supported by increased product sales, which rose 20.5% compared with the previous quarter.
On a year-over-year basis, product sales increased more than fourfold, contributing significantly to the company’s overall revenue expansion.
Total quarterly revenue of $9.1 million represented a 21.9% sequential increase and a 182.8% improvement compared with the third quarter of 2025.
The figures indicate a substantial recovery in sales activity, although the company did not provide a detailed breakdown of revenue by individual product category in its preliminary announcement.
The improvement in product sales also contributed to higher gross profitability compared with the prior-year period.
Sequans reported a third-quarter gross margin of 33.0%, compared with 32.9% in the second quarter of 2026.
The margin also improved significantly from 25.3% in the corresponding quarter of 2025, representing an increase of 770 basis points.
The year-over-year expansion indicates that Sequans generated a higher proportion of gross profit from its revenue.
The improvement accompanied the substantial increase in product sales, although the preliminary results did not provide a detailed explanation of the factors behind the margin expansion.
The combination of stronger revenue and improved gross margins contributed to a significant reduction in the company’s reported operating loss.
Sequans reported an operating loss of $1.0 million for the third quarter, compared with a loss of $7.2 million in the preceding quarter.
The result also represented a substantial improvement from the $24.4 million operating loss recorded in the third quarter of 2025.
The narrowing of losses reflected a significant change in the company’s reported financial performance.
However, the third-quarter results included a realised net gain of $6.2 million from Bitcoin sales, which should be considered when evaluating the improvement in profitability.
The gain was associated with Sequans’ decision to exit its Bitcoin treasury strategy during the quarter.
As a result, the reduction in reported losses cannot be attributed entirely to improvements in the company’s underlying semiconductor operations.
Sequans completed the disposal of its Bitcoin holdings during the third quarter, ending its cryptocurrency treasury strategy.
The company recorded a realised net gain of $6.2 million from Bitcoin sales during the period.
At September 30, 2026, Sequans held no Bitcoin on its balance sheet.
This compared with holdings of 314 Bitcoin valued at $18.4 million at June 30, 2026.
The disposal eliminated the company’s direct Bitcoin treasury exposure at the quarter-end reporting date.
The transaction also contributed to the financial results reported for the period, including the improvement in the company’s overall loss position.
The decision represents a change in Sequans’ treasury management approach following its previous investment in digital assets.
Sequans reported a third-quarter net loss of $1.5 million, equivalent to $0.10 per diluted American Depositary Share (ADS).
This compared with a net loss of $9.8 million, or $0.65 per diluted ADS, in the second quarter of 2026.
In the corresponding period of 2025, the company recorded a net loss of $16.6 million, equivalent to $1.19 per diluted ADS.
The latest figures therefore represent a substantial reduction in reported losses on both a sequential and year-over-year basis.
On a non-IFRS basis, Sequans reported a third-quarter net loss of $0.6 million, equivalent to $0.04 per diluted ADS.
The difference between IFRS and non-IFRS results reflects adjustments applied under the company’s alternative performance measures.
While the quarterly loss narrowed significantly, the company remained unprofitable under both reporting measures.
Sequans ended the third quarter with $39.7 million in cash, cash equivalents and short-term deposits.
This represented an increase of $18.7 million from the $21.0 million reported at June 30, 2026.
The stronger cash position followed a period of significant balance sheet changes, including the sale of Bitcoin holdings and repayment of convertible debt.
The increase provides Sequans with additional liquidity compared with the previous quarter.
However, the preliminary announcement did not provide a complete breakdown of the cash movements responsible for the increase.
The company’s liquidity position will remain an important consideration as it continues developing its semiconductor business and managing operating expenses.
Sequans reported that it repaid $94.5 million in convertible debt during the nine months ended September 30, 2026.
Following these repayments, the company had no remaining convertible debt on its balance sheet.
The elimination of convertible debt represents a significant change in Sequans’ capital structure.
Convertible debt can potentially be exchanged for equity under specified conditions, making its repayment relevant to shareholders assessing future dilution and financing obligations.
The removal of these liabilities simplifies the company’s debt profile, although the announcement did not provide details of any other outstanding borrowing arrangements.
The repayment also formed part of the broader financial restructuring reflected in the company’s nine-month results.
Despite the improvement in third-quarter performance, Sequans reported a substantial net loss for the first nine months of 2026.
The company recorded an IFRS net loss of $87.5 million for the period ended September 30.
This included $32.3 million in noncash digital asset impairment charges.
The nine-month results also included a $31.5 million noncash loss associated with debt extinguishment.
Together, these two items accounted for $63.8 million of the reported nine-month loss.
The charges highlight the financial impact of Sequans’ digital asset activities and debt restructuring during 2026.
Although these expenses did not represent equivalent cash outflows when recognised, they had a significant effect on the company’s reported IFRS results.
Sequans’ preliminary third-quarter results demonstrated substantial revenue growth, improved gross margins and a significant narrowing of reported losses.
Revenue increased 182.8% year over year to $9.1 million, while gross margin improved to 33.0% from 25.3% a year earlier.
The company’s operating loss narrowed to $1.0 million, although the results benefited from a $6.2 million realised gain on Bitcoin sales.
Sequans also completed its exit from Bitcoin holdings, increased its cash position to $39.7 million and eliminated $94.5 million of convertible debt during the first nine months of the year.
However, the nine-month IFRS net loss of $87.5 million highlights the continuing financial impact of restructuring and digital asset-related charges.
Investors will be monitoring whether Sequans can sustain product revenue growth, maintain improved gross margins and move towards profitability without the contribution of one-off gains.
The results remain preliminary and unaudited, meaning the reported figures may be subject to adjustment when the company finalises its financial statements.
Sequans Communications is a semiconductor company specialising in cellular Internet of Things (IoT) connectivity solutions.
The company develops wireless communication chips, modules and related technologies designed to connect devices across industrial, commercial and consumer applications. Its products support cellular connectivity for IoT devices and other connected systems.
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